New KATA Plans Set to Benefit Small Taxpayers in Hungary
- 28 Sep 2026 11:56 AM
The Tisza government is working on reinstating and broadly expanding the scope of the itemised tax for small businesses (KATA), Prime Minster Peter Magyar said in a speech in Szolnok, in central-eastern Hungary on Saturday 26 September.
Magyar said they would once again allow businesses under the KATA scheme to issue invoices not only to private individuals but also to companies and organisations.
They would also extend KATA eligibility to non-full-time entrepreneurs, including those working alongside a primary job, pensioners, and university students.
Work is currently under way on a solution that could enable as many as 100,000 or even more small taxpayers to join this favourable tax regime, he said.
With the expansion of the KATA scheme, the social security and pension entitlements of small taxpayers must also be addressed. "You cannot leave hundreds of thousands of people in a country without a pension. One must think not only of tomorrow, but also of the day after," Magyar said.
The prime minister said because of this the monthly tax instalment of KATA taxpayers must also be raised, either significantly in a single step or in two smaller increments. Plans also include raising the annual revenue threshold to 19 million forints.
Fidesz: Tisza drastically raising tax for KATA taxpayers
The Tisza Party intends to drastically raise the itemised tax for small businesses (KATA), the leader of opposition Fidesz's parliamentary group said on Sunday 27 September, accusing the ruling party of having deceived KATA taxpayers with its election promises.
"Peter Magyar announced a significant tax hike for KATA taxpayers," Janos Boka said in a post on Facebook. "It is interesting that not a word was said about this during the campaign. The substantial tax increase is allegedly necessary so that KATA taxpayers can also qualify for sick pay and pensions. However, KATA taxpayers are already eligible."
He noted that Magyar during the campaign on October 23, 2024, promised the reintroduction of KATA and in February 2025 a reduction in the tax burden for small businesses.
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